The Importance of Sticking to Your Area of Expertise
Quite a few years ago I worked in the Retail Division of Mobil Oil in Brisbane. I travelled around the state; stayed in luxury hotels; quizzed site owners about their operations; wielded power in allocating funds and appointing franchisees.
The Retail Division was seen as the flashy cousin to the dull and boring refinery operations. Everyone in Retail worked hard (more like we were driven hard!) and occasionally also got some play time as a group.
It was the '90's and the idea of combining petrol sales with convenience stores was still a novel idea in Australia. I was also heavily involved in the fast food sites located on major highways - another new concept.
Time moves on...
Over a few years the Retail Division was wound down, and slowly but surely became inactive.
Why?
Because it wasn't a good fit with the overall operation of Mobil. Essentially Mobil couldn't compete in the retail market place against the faster moving compettors of BP and Shell. It is a high investment, high risk industry.
And today it is reported that 7-Eleven buys Mobil petrol stations.
Behind the scenes it can be assumed that Mobil has struggled for many years to 'keep up with the Jones'. It is obvious that BP and Shell secured lucrative retail sites on major roads, and invested heavily in upgrading their sites.
Mobil stood still because they weren't committed to retail operations. They couldn't see a return.
The lesson here is that you need to define your market place, and your area of expertise, and make sure you stick to it. Mobil wandered into retail operations for decades without making a success of it.
Don't make the same mistake.
The Retail Division was seen as the flashy cousin to the dull and boring refinery operations. Everyone in Retail worked hard (more like we were driven hard!) and occasionally also got some play time as a group.
It was the '90's and the idea of combining petrol sales with convenience stores was still a novel idea in Australia. I was also heavily involved in the fast food sites located on major highways - another new concept.
Time moves on...
Over a few years the Retail Division was wound down, and slowly but surely became inactive.
Why?
Because it wasn't a good fit with the overall operation of Mobil. Essentially Mobil couldn't compete in the retail market place against the faster moving compettors of BP and Shell. It is a high investment, high risk industry.
And today it is reported that 7-Eleven buys Mobil petrol stations.
Behind the scenes it can be assumed that Mobil has struggled for many years to 'keep up with the Jones'. It is obvious that BP and Shell secured lucrative retail sites on major roads, and invested heavily in upgrading their sites.
Mobil stood still because they weren't committed to retail operations. They couldn't see a return.
The lesson here is that you need to define your market place, and your area of expertise, and make sure you stick to it. Mobil wandered into retail operations for decades without making a success of it.
Don't make the same mistake.
Labels: entreprenuers, marketing strategy, small business
posted by Stuart Ayling @ 3:52 PM
1 Comments:
At 1:29 PM,
Anonymous said…
Great article, Stuart. It's especially noticeable around Brisbane that Mobil has not kept pace and many of their outlets are in desperate need of a makeover.
The difference with Mobil and say, BP is that Mobil has defined themselves as a 'provider of oils and fuels', whereas BP has defined themselves more as 'helping people on their way' so although they're core expertise is finding and refining oil, their operations and marketing are never limited by their core activity. BP realised that people stopping for fuel are on the way home, on a long journey, or on the way to work, so what else might they need? All businesses need to be careful of how they define themselves. It's very easy to focus on what you do best today, but that may not bring in dollars tomorrow.
We all need to ensure we remain good at what we do, however we need to be able to move quickly when opportunities present or when markets change. Limiting your definition will limit thinking. A strong yet broad definition will encourage exploration into how your product or service could better help your customers, and help sustain the bottom line.
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